ANNOUNCEMENT 29 Mar 2016In March 2016, the government of Indonesia announced a change in its trade finance instruments.
NUMBER OF INTERVENTIONS
Coordinating Ministry for Economics Affairs press release (in Bahasa Indonesia)
On 29 March 2016, the Indonesian Coordinating Minister for Economic Affairs announced at a press conference the 11th Stimulus Package.
Introduction of the Export Oriented People's Business Credit (KURBE)
As part of the package, the government introduced the KURBE facility, directed at providing financing options for exporting micro, small and medium-sized entreprises. The facility will provide funds as working capital (up to 3 years) and investments (up to five years) and at an interest rate of 9% "without subsidies" and will be managed by the Indonesian Eximbank (LPEI).
Micro firms will be able to receive a credit of up to 5 billion IDR (ca.380 thousand USD), small ones up to 25 billion IDR (1.9 million USD) for investments and 15 billion IDR (1.1 million USD) as working capital. Meanwhile, medium-sized entreprises may receive a loan of up to 50 billion IDR (3.8 million USD) for investments and 25 billion IDR as working capital.
According to the press release, KURBE's main target is to facilitate exporters' access to suppliers, particularly the ones in labour-intensive industries.
Support for pharmaceutical and medical devices industry announced
Furthermore, the package included the development of a "road map" to support the Indonesian pharmaceutical and medical devices industry, since Indonesia imports 95% of its medicines and 90% of used medical devices.
The Ministry did not specify concrete measures but mentioned the support would come "largely through fiscal 'policy', among others exemption or reduction of import duties, tax holidays and tax allowances" (own translation).
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.
The list of affected trading partners is based on 2014 trade volumes.